Forum Archive Index - January 2001

["Ben Dutton" <bendutton@sharechat.co.nz>]

Thanks for the contributions Mark, Nick and Douglas (good to hear from you, Douglas!).

 

Certainly some very valid points, I was especially interested to hear of these asset sales, as reported by Douglas - and agree with Nick that Nufarm is in a pretty "unsexy" and "politically sensitive" arena at the moment.

 

Best Regards

 

Benjamin Dutton

----- Original Message -----

From: Douglas Stewart

To: sharechat@sharechat.co.nz

Sent: Friday, January 05, 2001 9:17 AM

Subject: Re: [sharechat] NUF to come right

Hullo,

 

I've been following and enjoying sharechat for several months.

 

I've just had a quick glance at the NUF 2000 annual report.

 

My concern about investing in this company would be the quality of its earnings, a large part of which seem to consist of asset sales. 

 

In 1999 pre-tax earnings were  A$ 79.6 million but asset sales amounted to $107.5 million.

 

In 2000 pre-tax earnings (for 14 months) were A$ 77.0 million but asset sales amounted to $50.4 million.

 

The p/e on earnings ignoring asset sales (which cannot continue indefinitely) looks very much less attractive.

 

Perhaps this explains the "low" shareprice?